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Perhaps you have heard of HIPAA – the Health Insurance
Portability and Accountability Act – during a visit to
your doctor's office. The doctor's staff may have handed
you a "HIPAA privacy notice" advising you of
protections for your personal health information. But
HIPAA covers a lot more than privacy.
For many people, health coverage is an important
benefit of their jobs. At the time HIPAA was passed, a lot
of people were afraid to switch jobs because they might
lose the insurance coverage they needed for their
families. This publication will explain how HIPAA’s
protections make it easier to change employers without
losing health coverage for your (and your family’s)
medical conditions.
HIPAA's umbrella of protection:
-
Limits the ability of a new employer plan to exclude
coverage for preexisting conditions;
-
Provides additional opportunities to enroll in a
group health plan if you lose other coverage or experience
certain life events;
-
Prohibits discrimination against employees and their
dependent family members based on any health factors they
may have, including prior medical conditions, previous
claims experience, and genetic information; and
-
Guarantees that certain individuals will have access
to, and can renew, individual health insurance policies.
HIPAA is complemented by state laws that, while similar
to HIPAA, may offer more generous protections. You may
want to contact your state insurance commissioner's office
to ask about the law where you live. A good place to start
is the Web site of the National Association of Insurance
Commissioners. Before you read on, note that this booklet focuses on
HIPAA’s coverage as it applies to private-sector group
health plans only. State, and local government employees
should contact the Centers for Medicare and Medicaid
Services at the U.S. Department of Health and Human
Services about whether they have
comparable protections.
Your Health Plan And HIPAA...Making The Law Work
For You does not cover HIPAA in its entirety; it is an
informal explanation of the law and Federal regulations,
not a legal interpretation. If you have additional
questions, refer to the Resources section or contact the
EBSA regional office nearest you. For a list of offices,
visit the agency's Web site at www.dol.gov/ebsa or call 1.866.444.EBSA (3272) to be connected to a regional
office.
One of the most important protections under HIPAA is
that it helps those with preexisting conditions get health
coverage. In the past, some employers' group health plans
limited, or even denied, coverage if a new employee had
such a condition before enrolling in the plan. Under HIPAA,
that is not allowed. If the plan generally provides
coverage but denies benefits to you because you had a
condition before your coverage began, then HIPAA applies.
Under HIPAA, a plan is allowed to look back only 6
months for a condition that was present before the start
of coverage in a group health plan. Specifically, the law
says that a preexisting condition exclusion can be imposed
on a condition only if medical advice, diagnosis, care, or
treatment was recommended or received during the 6 months
prior to your enrollment date in the plan. As an example,
you may have had arthritis for many years before you came
to your current job. If you did not have medical advice,
diagnosis, care, or treatment – recommended or received
– in the 6 months before you enrolled in the plan, then
the prior condition cannot be subject to a preexisting
condition exclusion. If you did receive medical advice,
diagnosis, care, or treatment within the past 6 months,
then the plan may impose a preexisting condition exclusion
for that condition (arthritis).
In addition, HIPAA prohibits plans from applying a
preexisting condition exclusion to pregnancy, genetic
information, and certain children.
If you have a preexisting condition that can be
excluded from your plan coverage, then there is a limit to
the preexisting condition exclusion period that can be
applied. HIPAA limits the preexisting condition exclusion
period for most people to 12 months (18 months if you
enroll late), although some plans may have a shorter time
period or none at all. In addition, some people with a
history of prior health coverage will be able to reduce
the exclusion period even further using creditable
coverage. (Read Chapter 2 to learn more.) Remember, a
preexisting condition exclusion relates only to benefits
for your (and your family’s) preexisting conditions. If
you enroll, you will receive coverage for the plan’s
other benefits during that time.
Although HIPAA adds protections and makes it easier to
switch jobs without fear of losing health coverage for a
preexisting condition, the law has limitations. For
instance, HIPAA:
-
Does not require that employers offer health
coverage;
-
Does not guarantee that any conditions you now have
(or have had in the past) are covered by your new
employer's health plan; and
-
Does not prohibit an employer from imposing a
preexisting condition exclusion period if you have been
treated for a condition during the past 6 months. (But see
Chapter 2 on creditable coverage to reduce or eliminate
the exclusion.)
It depends on whether you received medical advice,
care, diagnosis, or treatment within the 6 months prior to
enrolling in a new employer’s plan. If you did, you can
be subject to a preexisting condition exclusion.
Yes, as follows:
-
Pregnancy, even if the woman had no prior coverage
before enrolling in her current employer's plan.
-
Conditions present in a newborn or a child under 18
who is adopted or placed for adoption (even if the
adoption is not yet final), as long as the child is
enrolled in health coverage within 30 days of birth,
adoption, or placement for adoption. In addition, the
child must not have a subsequent, significant break in
coverage (defined as 63 days). For instance, a significant
break might occur if a parent lost his job and health
coverage for himself and his family shortly after a child’s
birth. This break will be discussed in the next chapter.
-
Genetic information. For example, if a woman is
found to have a gene indicating she is at a higher risk
for breast cancer, she cannot be denied coverage if there
is no diagnosis of the disease.
No. If your last treatment was more than 6 months
before enrollment in your new employer's health plan and
you have had no other advice or care relating to your
carpal tunnel syndrome in the last 6 months, your
condition cannot be subject to a preexisting condition
exclusion.
An employer's health plan may indeed have a waiting
period before any employee and his/her dependent family
members can enroll. If that is the case, the plan booklet
(called a summary plan description (SPD)) will say so.
If a plan has a general waiting period and a
preexisting condition exclusion period, both time periods
must run concurrently. For example, an employer may impose
a 3-month waiting period for all employees to begin health
coverage. Some employees may also be subject to the
maximum preexisting condition exclusion period of 12
months. In this example, the maximum preexisting condition
exclusion period remaining is 9 months long, as
illustrated below.
Be aware that your plan may not have a preexisting
condition exclusion period, so be sure you know your new
company's policy when you enroll.
If, for some reason, you did not enroll in your new
employer's health plan at the first opportunity but do so
at a later time, you are a late
enrollee. For example,
assume an employee declines coverage in his employer’s
health plan when he starts his new job. This employee
decides to enroll 2 years later during an open enrollment
period. At the time the employee wishes to enroll, there
is no special enrollment opportunity (the right to enroll
regardless of regular enrollment dates, see Chapter 4 for
when this right arises). When the employee elects
coverage, he is a late enrollee.
Being a late enrollee will not cause you to lose HIPAA’s
protections. One immediate consequence, however, is that
the maximum preexisting condition exclusion period is 18
months, rather than the 12 months for those who enroll at
the first chance.
If your group health plan permits coverage of family
members ("dependents"), and if they participate
in the plan, then they will have the same HIPAA
protections as employees, described above.
Yes. Protections against discrimination will be
discussed in Chapter 5.
-
Even if your plan applies a preexisting condition
exclusion, you are still covered for the plan's other
benefits – as long as you enroll.
-
If you have a baby or adopt a child, enroll the
child in health coverage within 30 days.
-
Remember, a new health plan can look back 6 months
when reviewing for a preexisting condition, and the
maximum amount of time of a preexisting condition
exclusion period is usually 12 months (18 months for late
enrollees).
-
If you have a preexisting condition, try to avoid a
63-day significant break in coverage. If you can do so,
you may be able to reduce the amount of time of a
preexisting condition exclusion in a new employer’s
plan. (Read Chapter 2 to learn more about reducing a
preexisting condition exclusion with creditable coverage.)
If you change jobs or begin new health coverage, and
you or a dependent family member have a preexisting
condition, Chapter 1 discussed how HIPAA limits the
maximum preexisting condition exclusion to 12 months (18
months if you are a late enrollee).
This chapter covers how an individual can reduce or
eliminate this maximum preexisting condition exclusion
period if she can show creditable
coverage.
-
Most health coverage can be used as creditable
coverage, including participation in a group health plan,
COBRA continuation coverage, Medicare and Medicaid, as
well as coverage through an individual health insurance
policy. (Read more about COBRA and HIPAA in Chapter 6.)
-
However, you should try to avoid a
significant break
in coverage (63 days) if you want to be able to count your
previous coverage. If you have a break shorter than 63
days, coverage you had before that break is creditable
coverage and can be used to offset a preexisting condition
exclusion period.
-
Days spent in a waiting period for coverage cannot
be used as credit. But, they also are not counted toward
the significant break (63 days) you are trying to avoid.
Yes. The break in coverage between one period of
health coverage and another can be no longer than 63 days
(just over 2 months). If you are between jobs and do not
have health coverage for 63 days or more, then you may
lose the ability to use the coverage you had before the
break to offset a preexisting condition exclusion period
in a new health plan.
No, not if you enroll when you are first eligible.
Those 45 days do not count as a significant break in
coverage. Also, since you have more than 12 months of
continuous coverage in a prior health plan, it can be used
to fully offset and eliminate the maximum preexisting
condition exclusion period under a new plan.
Possibly. Remember that under HIPAA, health coverage
prior to a significant break cannot be used to offset a
preexisting condition exclusion period. However, your
state law may be more generous if you have coverage with
an insured plan. If your state lengthened the significant
break from 63 days to, for instance, 120 days, then you
can use your prior coverage from a previous job as
creditable coverage. Check your plan’s summary plan
description (SPD) to see if your plan is insured. If it
is, check with your state insurance commissioner’s
office to see what your state law
provides.
Suppose an employee had coverage for 2 years,
followed by a break of 70 days. The employee then resumes
coverage for 8 months before moving to a new job, with no
time off between jobs. He enrolls in the health plan at
the new job as soon as possible.
A preexisting condition exclusion can last 12 months at
most, if the person enrolls when first eligible. This
employee has 8 months of creditable coverage. His earlier
2 years of health coverage are not creditable because he
had a break in coverage that was more than the 63 days
allowed under the law. His preexisting condition exclusion
will last 4 months after he enrolls in the employer's
health plan.
If the same employee had a break in coverage of only 60
days, his story would be different. This would not be a
significant break and he could use the earlier 2 years of
coverage to completely offset the preexisting condition
exclusion period.
There are several ways:
If a spouse has coverage in a health plan that
allows family members to join, you may want to enroll.
(For a discussion of special enrollment, see Chapter 4.)
If your last coverage was in a group health plan,
you may want to sign up for COBRA continuation coverage.
While you (and your family members, if they were also part
of your prior plan) will have to pay for this temporary
coverage, COBRA can prevent or reduce a break in coverage.
(Learn more about COBRA in Chapter 6.)
You can buy an individual health insurance policy if
you think you would otherwise have a break of 63 days or
more.
Some states have high-risk pools for people who
cannot otherwise get health benefits. Your state insurance
commissioner's office can tell you if such a pool exists
where you live.
Yes. You can look into:
Electing COBRA coverage from your former employer’s
plan;
Buying an individual health insurance policy; or
Checking with another plan you’re eligible for,
such as a spouse’s plan, to see if you can enroll.
Usually, the information is given in a
certificate of creditable
coverage. (Learn
more about the certificate in the next chapter.)
-
HIPAA allows for short breaks when you are counting
back to accumulate creditable coverage. For example, you
have a break in coverage of 30 days, followed by more
coverage, and then followed by another 30-day break. Both
periods of health coverage can be counted as you add up
the time spent in prior health plans.
As long as any break is no longer than 63 days, you
will not have a significant break. You can continue to
count back coverage to accumulate 12 (or 18 for late
enrollees) months of total coverage.
-
Try to avoid a significant break in coverage. Look
to a spouse’s plan, COBRA continuation coverage, or an
individual policy.
Your group health plan, HMO, or health insurance
company should provide you with a certificate of
creditable coverage, a document that shows your prior
periods of coverage in a health plan:
-
Before you lose your present coverage: If you know
you will be leaving a job, you can request a certificate,
free of charge.
-
After coverage ends: You should receive a
certificate automatically upon loss of coverage, even if
you are also eligible for COBRA continuation coverage. If
you don’t get one, or if you need a new one, you can
request a certificate, free of charge, up to 24 months
after prior coverage ends.
-
When COBRA coverage ends: You should also
automatically receive a certificate when COBRA
continuation coverage ends.
With your permission, another person can request a
certificate of creditable coverage on your behalf.
In addition to standard identification information,
the certificate will include the dates on which your prior
health plan coverage began and ended. The certificate also
should have contact information so that old and new plans
can be in touch if necessary. Finally, there should be
information about your HIPAA rights.
The amount of time depends on whether you receive
the certificate automatically or upon request.
-
The automatic certificate should reflect at least
the most recent period of continuous coverage.
-
The certificate issued at your request or a
dependent’s should reflect at least each period of
creditable coverage within the prior 24 months. The
certificate does not have to reflect more than 18 months
of continuous health coverage (the longest possible
preexisting condition exclusion period) without a
significant break.
-
If you’re eligible for COBRA, the certificate must
be provided no later than your COBRA election notice
(generally 44 days after a qualifying event).
-
For all other automatic certificates, generally you
should receive it within a reasonable amount of time after
coverage ends.
-
The plan should provide a requested certificate as
early as possible.
Also, be aware that health plans must issue
certificates, even if they do not exclude coverage for
preexisting conditions. While an employee may not need a
certificate in a current job, she might if a future
employer’s plan has a preexisting condition
exclusion.
If your new plan imposes a preexisting condition
exclusion, your claims processing will go smoother if you
don’t delay. There is an alternate way to show that you
had creditable coverage – you can present evidence of
your prior health coverage to your new health plan.
Evidence can include:
-
Pay stubs that reflect a deduction for health
coverage premiums;
-
Copies of premium payments or other documents
showing evidence of coverage;
-
Explanation of benefit forms; and
-
Verification by a doctor or your former health plan.
In addition to providing these documents, an individual
may be asked to attest to the period of creditable
coverage and cooperate with the new plan’s reasonable
efforts to verify creditable coverage.
You should still get in touch with the plan's
administrator to request a certificate for your records.
The administrator’s contact information is usually
included in the plan brochure you received when you signed
up for health coverage.
Yes. A plan must make every reasonable effort to
collect dependent information and then issue certificates
to dependents if they are also covered. However, if an
employee and a dependent have the same coverage, only one
certificate reflecting both individuals may be issued.
First, check it for accuracy. Does it reflect the
amount of time you had prior coverage? Does it include the
contact information of the issuer in case your old and new
plans need to communicate? Is your personal data correct?
Second, either give it to your new employer (after you
make a copy for yourself) or file it away in a safe place.
-
In case you lose your certificate or can't get one,
make sure you have other documents, such as pay stubs or
copies of premium payments, that show you had coverage.
-
When you leave a job, you may receive several
documents from your previous employer or health plan. Look
for the certificate of creditable coverage (it may be
identified as a “certificate of group health plan
coverage”) and file it with other important papers.
Special enrollment allows individuals who previously
declined health coverage to enroll for coverage. Special
enrollment rights arise regardless of a plan’s open
enrollment period.
There are two types of special enrollment – upon loss
of eligibility for other coverage and upon certain life
events. Under the first, employees and dependents who
decline coverage due to other health coverage and then
lose eligibility or lose employer contributions have
special enrollment rights. For instance, an employee turns
down health benefits for herself and her family because
the family already has coverage through her spouse’s
plan. Coverage under the spouse’s plan ceases. That
employee then can request enrollment in her own company’s
plan for herself and her dependents.
Under the second, employees, spouses, and new
dependents are permitted to special enroll because of
marriage, birth, adoption, or placement for adoption.
For both types, the employee must request enrollment
within 30 days of the loss of coverage or life event
triggering the special enrollment.
Loss of eligibility for coverage may occur when:
-
Divorce or legal separation results in you losing
your spouse’s health insurance;
-
A young dependent, because of age, work, or school
status, is no longer a covered "dependent" under
a parent’s plan;
-
Your spouse’s death leaves you without coverage
under his or her plan;
-
Your spouse’s employment ends, as does coverage
under his employer’s health plan;
-
Your employer reduces your work hours to the point
where you are no longer covered by the health plan;
-
Your plan decides it will no longer offer coverage
to a certain group of individuals (for example, those who
work part time);
-
You no longer live or work in the HMO’s service
area;
-
You have a health claim that would meet or exceed
the plan's lifetime limit on all benefits.
These should give you some idea of the types of
situations that may entitle you to a special enrollment
right.
The employee or dependent must request enrollment
within 30 days after losing eligibility for coverage or
after a marriage, birth, adoption, or placement for
adoption.
It depends on what triggers your right to special
enrollment. Those taking advantage of special enrollment
as a result of a birth, adoption, or placement for
adoption begin coverage no later than the day of the
event.
For special enrollment due to marriage or loss of
eligibility for other coverage, your new coverage will
begin on the first day of the first month after the plan
receives the enrollment request. If the plan receives the
request on January 3, for example, coverage would begin on
February 1.
A preexisting condition exclusion cannot apply to a
special enrollee for longer than 12 months. As with those
who signed up with the plan at the first opportunity, a
special enrollee can show creditable coverage and reduce
or eliminate the maximum preexisting condition exclusion
period.
A newborn, an adopted child, or a child placed for
adoption cannot have a preexisting condition exclusion, as
long as the child is enrolled in health coverage within 30
days of the event, without a subsequent significant break
in coverage.
A description of special enrollment rights should be
included in the plan materials you received when initially
offered the opportunity to enroll.
Special enrollees must be offered the same benefits
that would be available if you are enrolling for the first
time. Special enrollees cannot be required to pay more for
the same coverage and cannot have longer preexisting
condition exclusion periods.
-
Become familiar with the events that can trigger a
special enrollment right; you must request coverage and
you need to act promptly.
-
Be sure you request enrollment within 30 days of a
marriage, a birth, an adoption, the placement of a child
for adoption, or any event that results in a loss of
eligibility for health coverage.
The previous chapters explain how to use HIPAA’s
preexisting condition and special enrollment protections
by being aware of their timelines and requirements. The
more you know, the better equipped you will be. The same
is true for HIPAA and discrimination in health coverage:
The more you know about the ways HIPAA prohibits
discrimination, the better.
Under HIPAA, you and your family members cannot be
denied eligibility or benefits based on certain
"health factors" when enrolling in a health
plan. In addition, you may not be charged more than
similarly situated individuals based on any
health factors. The questions and answers below define the
health factors and offer some examples of what is and is
not permitted under the law.
The health factors are:
-
Health status;
-
Medical conditions, including physical and mental
illnesses;
-
Claims experience;
-
Receipt of health care;
-
Medical history;
-
Genetic information;
-
Evidence of insurability (see below); and
-
Disability.
Conditions arising from acts of domestic violence as
well as participation in activities like motorcycling,
snowmobiling, all-terrain vehicle riding, horseback
riding, and skiing are considered “evidence of
insurability.” Therefore, a plan cannot use them to deny
you enrollment or charge you more for coverage. (However,
benefit exclusions known as “source of injury exclusions”
could affect your benefits. These exclusions are discussed
in more detail later in this chapter.)
No. You do not have to pass a physical exam to be
eligible for enrollment. This is true for individuals who
enroll when first eligible, as well as for late and
special enrollees.
Yes, as long as it does not use individual health
information to restrict enrollment or charge you more.
No. In this case the plan used health information to
exclude you from enrolling in the plan. This practice is
discriminatory, and it is prohibited.
No. A group health plan may not delay an
individual's eligibility, benefits, or effective date of
coverage based on confinement to a hospital or medical
facility at the time he becomes eligible. Additionally, a
health plan may not increase that person's premium because
he was in a hospital or medical facility.
No. A group health plan generally may not deny
benefits because someone is not "actively at
work" on the day he would otherwise become eligible.
However, a plan may require employees to begin work
before health plan coverage is effective. A plan may also
require an individual to work full time (say, 250 hours
per quarter or 30 hours per week) in order to be eligible
for coverage.
No. A group health plan may impose a preexisting
condition exclusion period, but it must be applied
uniformly. In this case, the plan is not applying its
provisions uniformly, since it is treating differently
those who had medical claims during the first 6 months of
coverage.
HIPAA states that plans may distinguish among
employees only on “bona fide employment-based
classifications” consistent with the employer’s usual
business practice. For example, part-time and full-time
employees, employees working in different geographic
locations, and employees with different dates of hire or
lengths of service can be treated as different groups of
similarly situated individuals.
A plan may draw a distinction between employees and
their dependents. Plans can also make distinctions between
beneficiaries themselves if the distinction is not based
on a health factor. For example, a plan can distinguish
between spouses and dependent children, or between
dependent children based on their age or student status.
Yes. A group health plan may apply lifetime limits
generally or for a specific disease or treatment –
provided the limits are applied uniformly to similarly
situated individuals and are not directed at specific
employees or dependents based on any health factors they
may have.
No. Group health plans cannot charge an individual
more for coverage than a similarly situated individual
based on any health factor.
However, be aware that HIPAA does allow an insurer to
charge one group health plan (or employer) a higher rate
than it does another. When an insurance company
establishes its rates, it may underwrite all covered
individuals in a specific plan based on their collective
health status. The result can be that one employer health
plan whose enrollees have more adverse health factors can
be charged a higher premium than another for the same
amount of coverage.
Think of it this way: HIPAA’s protections from
discrimination apply within a group of similarly situated
individuals, not across different groups of similarly
situated individuals. For example, an employer
distinguishes between full-time and part-time employees.
It can charge part-time employees more for coverage, but
all full-time employees must pay the same rate, regardless
of health status.
Also, take note that, for insured
plans, state law may
require the use of other methods for setting rates for
health coverage. More information is available at www.naic.org.
No. Participation in activities such as skiing would
be "evidence of insurability," which is a health
factor. Therefore, it cannot be used to deny eligibility.
Maybe. A plan can deny benefits based on an injury's
source, unless an injury is the result of a medical
condition or an act of domestic violence.
Therefore, a plan cannot exclude coverage for
self-inflicted wounds, including those resulting from
attempted suicide, if they are otherwise covered by the
plan and result from a medical condition (such as
depression).
However, a plan may exclude coverage for injuries that
do not result from a medical condition or from domestic
violence. For example, a plan generally can exclude
coverage for injuries in connection with an activity like
bungee jumping. While the bungee jumper may have to pay
for treatment for those injuries, her plan cannot exclude
her from coverage for the plan’s other benefits.
Yes. A plan can treat an individual with an adverse
health factor (such as a disability) more favorably by
offering extended coverage.
More and more employers are establishing wellness
programs that encourage employees to work out, stop
smoking, and generally adopt healthier lifestyles. HIPAA
encourages group health plans to adopt wellness programs
but also includes protections for employees and dependents
from impermissible discrimination based on a health
factor.
The questions and answers below provide some guidance
regarding wellness programs.
Yes, as long as the health plan offers the reward
based on participation in the program and not on test
results. For instance, a health plan might offer a premium
discount for those who voluntarily test for cholesterol.
The discount would be available to everyone who takes the
test, not just those who get a certain result.
For wellness programs where the plan offers a reward based on an individual’s ability to meet
a standard related to a health factor (such as a standard related to smoking/nicotine addiction), the rules require that:
-
The reward, such as a premium differential, must generally not exceed 20 percent of the cost of employee-only coverage under the plan. If the program allows an employee's dependents (such as spouses or children) to participate, then the reward must not exceed 20 percent of the cost of the coverage in which the employee and any dependents are enrolled;
-
The program must be designed to promote good
health or prevent disease;
-
Individuals must have a chance to qualify for the
nonsmoker’s premium discount at least once a year;
-
The program must accommodate those for whom it is
unreasonably difficult to quit using tobacco (for example,
due to nicotine addiction) by providing a reasonable
alternative standard (such as a discount in return for
attending educational classes or for trying a nicotine
patch); and
-
Plan materials describing the wellness program
must disclose the availability of a reasonable
alternative standard to qualify for the lower premium.
(Note: The wellness program rules are generally effective for plan years starting on or after July 1, 2007. Contact EBSA at 1.866.444.EBSA (3272) or http://askebsa.dol.gov for more information.)
State laws may complement HIPAA by allowing more
protections than the Federal law. However, these state
laws only apply if your plan provides benefits through an
insurance company or HMO (an insured
plan). To determine
if your plan offers insured coverage, consult your summary
plan description (SPD) or contact your plan administrator.
The list below summarizes those areas where state laws
can complement HIPAA’s preexisting condition and special
enrollment provisions:
-
States may reduce the number of months a plan can
look back to determine a preexisting condition. For
instance, a state's law may have a look-back period of 3
months instead of the 6 in the Federal law. The look-back
period begins on the day you enroll in a plan.
-
States may decrease the number of months a new
employee or dependent may be subject to a preexisting
condition exclusion period. For example, state laws may
limit the exclusion period to 6 months rather than 12.
They may also reduce the maximum 18-month exclusion period
for late enrollees.
-
States may increase the number of days that
constitute a significant break in coverage. For instance,
instead of 63 days, a state may allow someone to have a
break of 120 days between periods of health coverage.
-
States may increase the number of days (30 under
Federal law) parents have to enroll newborns, adopted
children, and children placed for adoption without a
preexisting condition being excluded.
-
Under Federal law, certain preexisting conditions
cannot be excluded from coverage (pregnancy; newborns,
adopted children, and children placed for adoption within
30 days; and genetic information in the absence of a
diagnosis). States may add to this list. For example, a
state may add cancer, so that plans cannot exclude it from
coverage, even if you received treatment during the 6
months before enrolling in a new plan.
-
States may require additional circumstances that
entitle you to special enrollment periods beyond those in
the Federal law.
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States may reduce an HMO's affiliation period prior
to enrollment (similar to a group health plan’s waiting
period) to fewer than 2 months (3 months for late
enrollees).
In other areas of HIPAA, such as protections from
discrimination, state laws may also supplement HIPAA’s
protections if the coverage is through an insured plan.
Check your SPD to see if your plan is insured and visit
your state insurance commissioner's office or the National
Association of Insurance Commissioners’ Web site (select your state) for more information.
COBRA is a law that can help if you lose your job or if
your hours are reduced to the point where the employer no
longer provides you with health coverage. COBRA can
provide a temporary extension of your health coverage –
as long as you and your family members, if eligible,
belonged to the previous employer's health plan and
generally the employer had 20 or more employees. Usually,
you pay the entire cost of coverage (both your share and
the employer's, plus a 2 percent administrative fee). As
long as the prior plan exists, COBRA coverage lasts up to
18 months for most people, although it can continue as
long as 36 months in some cases.
There are several ways to use COBRA in conjunction with
HIPAA:
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COBRA coverage can help you avoid a significant
break between periods of health plan coverage. For
example, if you expect to have a 6-month interruption
between jobs and health plans, you can purchase COBRA
coverage during that time.
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COBRA coverage can be counted as
creditable coverage
– as long as there is no significant break after your
COBRA coverage ends. Creditable coverage can be used to
offset any preexisting condition exclusion period you or a
family member might have.
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COBRA continuation coverage can be used as a bridge
to ensure that you remain covered during a waiting period
or a preexisting condition exclusion period.
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If you have COBRA and become covered under other
group health plan coverage that is not subject to a
preexisting condition exclusion period, your COBRA
coverage can be cut off.
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Once you are no longer eligible for COBRA coverage,
you will get a special enrollment opportunity for any
other coverage for which you are eligible. However, if you
voluntarily stop COBRA coverage or stop paying your COBRA
premiums, that will not trigger a special enrollment right
based on loss of eligibility for coverage.
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Your COBRA plan and other available health coverage
may be different in terms of their cost, scope of
benefits, or level of coverage.
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COBRA can be used instead of, or in addition to,
your new health coverage, if you are subject to a
preexisting condition exclusion period. When deciding
whether to choose COBRA, consider the length of your
preexisting condition exclusion period, whether you are
likely to need treatment for your preexisting condition
during this time, and the costs of and benefits of COBRA
coverage.
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Whether you elect COBRA coverage is an individual
decision. Taking into account this information, you can
make a decision that is best for the health of you and
your family.
HIPAA also protects those who are otherwise unable to
get group health insurance.
The law guarantees access to individual insurance
policies and state high-risk pools for eligible
individuals. They must meet all of the following criteria:
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Had coverage for at least 18 months, most recently
in a group health plan, without a significant break;
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Lost group coverage but not because of fraud or
nonpayment of premiums;
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Are not eligible for COBRA coverage; or if COBRA
coverage was offered under Federal or state law, elected
and exhausted it; and
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Are not eligible for coverage under another group health plan, Medicare, or Medicaid; or have any other health insurance coverage.
The opportunity to buy an individual policy is the same
whether a person quits a job, was fired, or was laid off.
Find out more about HIPAA, COBRA, and other laws that
pertain to health care. The publications and Web sites
below will help.
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The following publications are available from the
Employee Benefits Security Administration's toll-free
publications request line – 1.866.444.EBSA (3272) -- or
on the Web at www.dol.gov/ebsa (select "Publications/Reports"):
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An Employee's Guide to Health Benefits under COBRA: The
Consolidated Omnibus Budget Reconciliation Act of 1986
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Retirement and Health Care Coverage ... Questions and
Answers for Dislocated Workers
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Your Rights after a Mastectomy ... Women's Health and
Cancer Rights Act of 1998
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Protections for Newborns, Adopted Children, and New
Parents: The Newborns' and Mothers' Health Protection Act
of 1996
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Top Ten Ways to Make Your Health Benefits Work for You
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Life Changes Require Health Choices: Know Your Benefit
Options
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Work Changes Require Health Choices: Protect Your
Rights
The following Web sites offer information on
health-related topics, quality assurance in health care,
and women's health. Select a site, then choose a
topic of interest to you.
Certificate of Creditable Coverage: a document prepared
by a group health plan, HMO, or insurance company that
shows prior periods of creditable coverage, used to reduce
or eliminate the length of a preexisting condition
exclusion period.
COBRA: an abbreviation for the Consolidated Omnibus
Budget Reconciliation Act of 1986, a law that provides for
a temporary extension of health plan coverage from a prior
group health plan.
Creditable
coverage: a period of prior health coverage,
which may be used to offset the length of a preexisting
condition exclusion period. This includes coverage under a
group health plan, COBRA, Medicare and Medicaid, or an HMO
or individual health insurance policy.
Enrollment
date: the first day of coverage or the first
day of the waiting period (if applicable).
Insured
plan: a plan which provides benefits through an
insurance company or HMO. Check your summary plan
description (SPD) to see if your plan is insured.
Late
enrollee: an individual who enrolls in the plan at
some time other than when first eligible or a special
enrollment opportunity.
Preexisting condition
exclusion: a limitation or
exclusion of benefits relating to a condition because that
condition was present before the effective date of your
health coverage.
Preexisting condition exclusion
period: the amount of
time that you are excluded from coverage of benefits for a
preexisting condition (the maximum is 12 months, or 18
months for late enrollees).
Self-insured
plan: a group health plan where the
employer assumes the risk of paying the benefits itself.
An insurance company may provide administration services
to a self-insured plan, such as claims administration, but
does not assume any risk to pay claims for benefits.
Significant
break: a break in health coverage for 63
days or more.
Similarly situated
individuals: permitted distinctions
plans may make among individuals, such as groups of
employees, if based on "bona fide employment-based
classifications” consistent with the employer’s usual
business practice. For example, part-time and full-time
employees can be treated as different groups of similarly
situated individuals. In addition, a plan may draw a
distinction between employees and their dependents. Plans
can also make distinctions between dependents themselves
if the distinction is not based on a health factor. For
example, a plan can distinguish between spouses and
dependent children, or between dependent children based on
their age or student status.
Special
enrollment: an opportunity for certain
individuals to enroll in a group health plan, regardless
of the plan’s regular enrollment dates. These
opportunities occur when you lose eligibility for other
coverage or experience certain life events (marriage,
birth, adoption, or placement for adoption).
Summary plan description
(SPD): a document outlining
your plan, usually provided when you enroll in the plan.
Waiting
period: the time that must pass before coverage
can become effective under the terms of a group health
plan.
This publication has been developed by the U.S. Department of Labor, Employee Benefits Security Administration. For a complete list of the agency's publications, call toll free: 1.866.444.EBSA (3272). This material will be made available in alternate format upon request: Voice phone: 202.693.8664, TTY: 202.501.3911.
This booklet constitutes a small entity compliance guide for purposes of the Small Business Regulatory Enforcement Act of 1996.
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